The Principal Finance Officer (Schools) will present a report, Document GO, which asks Members to consider the outcomes of the consultation, which was agreed at the last meeting. The Forum is asked to make final recommendations on the structure of the Primary and Secondary funding formulae, and the criteria for the allocation of Schools Block funds, for the 2017/18 financial year. Please note that an appendix to Document GO will be tabled at the meeting as it contains the outcome of a consultation period, which concludes on 14October. This report also provides an update on further modelling related to the values of formula factors and the contribution from the Schools Block to High Needs Block pressures in 2017/18.

Recommended –

(1)       The Forum is asked to consider the outcomes of the consultation. Members are then asked to consider whether the proposals should be changed in the light of responses.

(2)       Schools Members are asked to make final recommendations on the structure of the formulae in the indicative pro-forma (Appendix 1) a) Primary and b) Secondary. Appendix 1 has been completed on the basis of the proposals outlined in the consultation document and as agreed by the Forum in the last meeting held on 21 September.

(3)       Schools Members are asked to consider the responses and to make recommendations on the criteria for the allocation of Schools Block funds a) Primary and b) Secondary for the 2017/18 financial year.     

(Sarah North – 01274 434173)

The Principal Finance Officer (Schools) presented Document GO. It was explained that Forum Members are asked to consider the outcomes of the consultation, which was agreed at the last meeting, and then to make final recommendations on the structure of the Primary and Secondary funding formulae, and the criteria for the allocation of Schools Block funds, for the 2017/18 financial year. It was also explained that the report provides an update on further modelling related to the values of formula factors and the contribution from the Schools Block to High Needs Block pressures in 2017/18 (the ‘worst case scenario’ modelling requested at the last meeting).

The Principal Officer took members through the report and the feedback that has been received. The level of engagement that we have had with schools was emphasised, on the issues outlined in the consultation paper, including the illustrative 1.5% reduction in pupil-led formula values and the ‘worst case scenario’ Minimum Funding Guarantee modelling. The Chair stated that it is helpful for Forum Members to hear about the significant level of communication that has been had with schools as the complexity of some of these issues is testing. The Chair also clarified that the Forum, at this meeting, is not being asked for a decision on a 1.5% reduction. Decisions relate purely to the structure, not the values, of the primary and secondary funding formulae for 2017/18.

The Chair asked officers to clarify for the Forum what the rationale is for showing worst case scenario modelling. It was explained that showing schools at this stage what the greatest extent of a reduction in their main formula funding would be in 2017/18 aids their early budget planning. The Principal Officer stated that the Council has had positive engagement with schools on the information (and the ready reckoner) that has been provided. The Schools Forum at the last meeting asked to see the worst case cumulative position for schools and the modelling attached to Document GO responds to this. It was clarified that this modelling was still based on an estimate of October 2016 pupil numbers and does not include a view of Post 16 funding. The modelling does include the impact of reductions in early years funding based on the DfE’s consultation proposals. It was explained that the Forum is being asked to consider a further contribution from the Schools Block to High Needs Block pressures in 2017/18, illustratively from a 1.5% reduction in pupil-led formula values, but that there was also a line of inquiry about whether a greater sum could be transferred from the Schools to the High Needs Block e.g. by reducing funding to the point that all primary and secondary schools and academies are on their MFG level. This was identify a further approximate sum of £2m. The Business Advisor (Schools) reminded Members that Document GG presented to the Forum on 21 September estimated that there is still a £1.2m funding gap in the 2017/18 DSG after the application of a 1.5% reduction in the Schools Block. The Business Advisor (Schools) added that, where the national funding formula is not favourable to Bradford, something akin to a 1.5% reduction year on year in funding could be the reality for Bradford schools over the next 5 years (depending on the timescale and level of protection decided by Government in its transition to the NFF). Alongside a very rough average of an annual 2.5% increase in costs, this could mean schools in Bradford facing something in the region of an average minimum 4% annual budgetary pressure. We are seeking to make sure that schools are aware of this as early as possible in their budget planning.

In response, Members asked the following questions and made the following comments:

·         At the last meeting a question was asked about whether funding changes would place schools cumulatively into deficit. Can this information be provided? The Business Advisor (Schools) explained that this request has not been forgotten but that it is difficult to give a useful view for a number of reasons, including because looking at current surplus balances positions and a value of possible funding reduction does not give insight into the action that the school can and will take to balance its budget. A better picture will emerge from our discussions with individual schools on their budgets. The Authority also does not have sight of academy balances.

·         A 1.5% reduction does not represent a significant cash loss for some school but for others the value is much more significant. This needs to be watched.

·         The information around the 1.5% and the Schools Block consultation has been presented to BPIP. One of the areas of feedback is how complicated these considerations are. The Chair stated that the Forum must tread carefully and must recognise that there is likely to be some difference in the level of understanding that the Schools Forum Members have about these issues and the understanding of the wider schools community. Decisions about a Schools Bock contribution in 2017/18 may be one of the most difficult decisions the Forum has yet taken.

·         Members asked for clarification of who sits on the Formula Funding Working Group. This was provided. It was also clarified that the role of the FFWG will be to do the more detailed analysis of formula funding impact but that this isn’t a decision-making group.

·         That, until the Government publishes its 2^nd stage of national funding formula proposals we can only speculate on the longer term impact for Bradford and we have no sight of the future position of our High Needs Block. We will need to develop our High Needs Block strategy in the context of the Government’s reform.

·         The Authority is requested to provide further information on the strategic case for the movement of Schools Block monies to the High Needs Block and to set out how the cost effectiveness of the allocation of the current High Needs Block is being secured.

Resolved –

(1)          That the additional modelling presented in Document GO be noted.

(2)          That the structure of the formulae for the calculation of individual primary and secondary school and academy budget shares for the 2017/18 financial year, as set out in Document GO Appendix 1, be agreed. Agreed by consensus (without requiring a vote).

(3)          That the criteria for the allocation of the DSG’s Schools Block Growth Fund, and other Schools Block centrally managed funds, as proposed in the consultation document, be agreed. 

Action:          Business Advisor (Schools)